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Closing Bell With Maria Bartiromo

News/Business. Maria Bartiromo. Analysis of the day's winners and losers in the stock market. New.

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01:00:00

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Virtual Ch. 58 (CNBC)

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mpeg2video

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ac3

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480

TOPIC FREQUENCY

Us 15, Schwab 7, Byron 6, Ben Bernanke 5, S&p 5, U.s. 5, Washington 4, Europe 4, Italy 3, Bernanke 2, Ford 2, Boeing 2, J.c. Penney 2, Ben Willis 2, Fed 2, Apple 2, Walmart 2, China 2, Unitedhealthcare 2, Todd Buchholz 2,
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  CNBC    Closing Bell With Maria Bartiromo    News/Business. Maria Bartiromo. Analysis of the  
   day's winners and losers in the stock market. New.  

    February 27, 2013
    4:00 - 5:00pm EST  

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that continues to flow in, you see it in the top leaders, the discretionary income, the telecoms, that tells you that the retail buyer is back and pumping money into this market. >> i said at the top of the show i bet there's not 20 people on the floor of the exchange who thought we would be here today with the kind of market we're seeing given what we saw on monday. are you one of them? >> i've been on before saying i've been looking for that pullback and waiting to buy the dip was monday. i think this is the panic missing buying the dip. take a look at the transports up 3% today. >> that's right. >> that's the durable good orders, the trains shipping all the shale oil throughout the country. that's -- that's been another great move, and they were basically dead earlier in the week, so it's -- it's very scary from a professional trader side, but you don't fight the fed. the other big ben, i used to be that guy until he showed up, and what's going on with the money flow is coming into equities. >> ben willis just moments ago mentioned short conversation. you think part of this at the end of the day was short covering. >> absolutely.
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>> the shorts were getting their head handed to them on monday and here we go, after monday on tuesday, and today as well. i'll seal you at the top of the hour. good to see you. >> another big hour. what do we do from here? >> if you're surprised by the action we've seen over the last couple of days, what are we to do? my professional trader, 30 years on the trading floor wants to sell into it but don't short it until you buy coverage. the vix had a great pullback. bought the vix earlier in the month, you had a great return on the investment but if you didn't sell it out and took the profit you're getting squeezed. buy the vix. >> even with the move that we've seen, a feeling that certainly the market would show you over the last, you know, few selloffs here that it's a bit fragile, right? >> absolutely. that it can be blown over with a little bit of wind. >> and tomorrow is the last day of the month. looks like a plus side february. >> nonetheless, going out today plus 175, second hour of the "closing bell" begins in just a few minutes with maria.
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and it is 4:00 on wall street. do you know where your money is? hi, everybody, welcome back to the "closing bell." i'm maria bartiromo on the floor of the new york stock exchange. a rip-roaring rally once again. second straight day after more good news on housing today. the dow erased monday's massive losses and inched closer again to a record high, all of this without any help from apple which was down nearly $4 a share. take a look at how we're settling out. on wednesday on wall street, dow jones industrial average up 1.25%, 176 points higher on the dow. 14,076 is where the index is closing out tonight. nasdaq up 32 points. technology and financials, the big winners on the session today. the nasdaq at 3162. the s&p 500 tonight, up 19 points, 1.25 points higher at 1516 indicating very, a very broad-based buying situation today. let's get straight to the market action with ed batowski, michael yosikami and josh brown and
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gordon charlotte from rosenblatt securities will join us in a moment who has been on the floor settling out his trades, and we'll talk with him about the end of the day. thanks for joining us. michael, what do you think about this rally today? do-to-what would you attribute the gains? >> a bit of a short covering. the economy is getting better. look at the home sales numbers as well as the durable good numbers, people are way too negative still, even though the markets rallied. i think what's starting to happen is that negative sentiment started to turn the individual investor and starting to get a bit of courage back, and i think you're starting to see money pour into equities like we talked last time. i think you're finally going to see flows coming out of fixed income in the money market accounts back into equities and that pushes the market higher. >> does everybody agree with that? >> not a chance in the world. >> go ahead. take it. >> ed, you said not a chance. >> i'll go ahead and take it. not a chance in the world. the individual investors doesn't mean anything in this market with the exception of the 401(k)
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plans that they contribute to. the reason the market went higher is short covering but along with that is bernanke basically saying, hey, what i'm doing is working, it's helping so what he really said in a way is i'm going to keep doing this and doing it and doing it and you don't fight the fed, but don't think for a moment -- everybody says housing, housing is getting better. yes, it's getting better but that's not the entire economy. the economy is in really bad shape, and the reason the market is going higher, don't forget, nothing to do with the individual investor, computer trading and because the fed is printing money. >> okay. but so what? we all know the reason that the market is rallying. >> that would -- >> it's going to go higher. absolutely going to go higher, without question. going to go higher without question, no question about that. >> weigh in here, josh. >> that's a stale thesis. that would have kept you out of market for about 157% now. >> guess what, i've been fully invested, you're absolutely wrong. you attributed the market going higher to the individual investor and that's not true. >> i didn't. >> the market is going higher.
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>> who said that? >> the market is going higher. i've been an investor in the market but not because of the individual investor. not true. 97% of the volume is computers. >> what the argument is, here's the argument, it's not nextly a great rotation yet. we've had claar 1 trillion in outflows from the investor and the market has gone straight up. we know it's the fed. that's an old stale thesis. >> it's obviously the fed. >> now the question is if behavior changes and animal spirits are actually here for the first time and the wealth effect from housing actually is a sign for the stock market, the question is can this continue, and would i say i'm not 100% convinced of that, but the signs look better than they did six months ago, a year ago. >> absolutely. completely agree. >> i agree. >> how do you see it, mark? >> i would agree. i think it's primarily fed-driven at this point but i wouldn't undersell the individual, at least moving forward from here. i don't think it's a rotation out of fixed income. haven't seen the spike in
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yields. this is cash coming off the table, maybe a little bit of gold from people that bought at klar 1,800 or $1,900 thinking it was going to 2,500. it's a combination of everything. fed at the top of the check list. housing is part of it. consumer confidence is part of it, and a slight rotation that's starting to move out so you add it all up, and i think it's there. probably put the fed at the top of that check list. >> let me get your take on this, you know -- >> and it's just starting. >> it seems like some of the most levered companies are actually the ones that are rising. you've got the most levered index up 2%, so is that a healthy market where the most leveraged stocks are actually the winners? >> i -- i just think that's a function of the fact that really large companies, which have been leading the market for years now, are able to finance at such cheap levels. would i have to look at what some of the top sectors are there, but i suspect you see some financial companies, and that's obviously a fed story. we're essentially handing them a
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net interest margin on a silver platter when they could bore for free and figure out different ways to lend so i'm not sure if that's the best way to gauge whether or not the market is healthy. >> just getting this from s&p capital iq. the current 12-month forward price-to-earnings ratio for the s&p 500 is now less than where it was in october '07 when equities reached record high levels. >> absolutely. >> ed, you could talk all you want about the fact that this is a bernanke rally and the fact that the fed is creating an environment where there are few alternatives, but at the end of the day valuations are not excessive. >> i've never said that valuations were excessive. what i've said all along is stocks are cheap. stocks are 25% below where they should be. i just don't believe the fact that the individual investor is causing this. i think stocks could substantially higher especially if they break 14,300. i think we're going a lot higher in the overall market, without question. >> see what matters. if you look at why the market is up. it's obvious. the fed is juicing the market. that's not the question. the question is not what
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happened? the question is what will happen? >> agreed. >> the fed is already here. the bottom line is what are going to be the stimulus factors? >> that's what we want to know. >> the stimulus factors are individual investor, housing recovery, durable goods orders increasing and emerging markets coming back. that is what's going to move the market higher. no one is disputing the fact that the fed has juiced the market. the reality is stocks are likely cheap where they are right now, but as you correctly point out, maria so often, we're in a very, very unhealthy situation right now where the market is in fact bid up by the fed. if the fed put interest rates were, quote, unquote, where they should be, we wouldn't be anywhere where we're at in the market. >> i think the last point is a good one. >> gordon is watching the flow. gordon, what can you tell us at the end of the day. was there a sell imbalance or buy imbalance. >> a little bit of a selloff but the thing you have to be wondering out here is look at vix in relation to the way the market has been behaving.
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guys down here starting to sense we may be seeing a near term bull trap setting up here, up 200, down 200. oh, it's only up 100 today, no big deal, so, i mean, guys are sitting here, and, you know, just happening too easily, too quickly. everybody who is behind on investing is saying oh, i have to get in. this isn't what makes a healthy market. this is what makes it go up. right now what we have, the italian bond auction went better than expected so europe is fine. >> what about spain's auction on the horizon in the next couple of weeks, right? >> we have that coming, too, maria, the whole point. little isolated episode and all of a sudden europe's problems are entirely behind them and then like this euro/dollar thing going on. the market loves currency wars because now you can buy it in the cheaper currency. a lot of this just continues to be sort of, you know, inflated by like external terms. macro terms that are sort of unrelated to terngs, the kinds of things that you really want to talk about if you're going to see a strong move. still don't have the volume we're looking for.
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the vix is down again today in a big way. i mean, it's too easy. setting up -- >> are you telling me you want to tell into this ral? >> at some point you have to be mindful of a correction and be aware that this is going to turn around. you've got to be nimble. guys saiding here saying you've got to boy, got to buy. this valuation is good. it's going up. cash on the sideline. it's all coming in. that's not what makes a healthy market. if the reason you're putting your money is there because there's no place else to put t.eventually you'll start to see this thing turn around, and when it does it will pick up speed. yeah, we'll see a correction here pretty soon. >> i think there are some other places to put it. >> gentlemen, thank you. >> final word there, go ahead. >> i think that point earlier made about emerging markets. emerging markets are probably arguably the undervalued part of equities around the globe, and they have not participated in this, and international, it did well today outside the u.s., but they are still negative, at least for this month, so as far as maybe moving away from a
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market that maybe has gotten a little overheated in the short run, outside of the u.s. and emerging markets might be a good place to move to. >> we've got to go. gentlemen, thank you very much. blackstone's byron wean not buying this rally saying investors need to be suspicious of the wave of euphoria and focus on the fundamentals and joins me on the telephone. good to have you on the program. thanks so much for calling n.appreciate your time, byron. >> always good to talk with you, maria. i think you had a lot of good ideas presented by the other people earlier. there were a lot of cross-currents today, and they should give investors some pause. >> what concerns you the most, byron? >> fundamentals are really key here. >> what concerns you the most, byron? >> well, i'm concerned about the fact that people are oblivious to the fact that the 2% payroll tax is over. people will have less money in their pockets. the sequester looks like it's going to kick in. there's an increase in taxes at the high end. so i think that the government is going to be spending less and
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consumers are going to be spending less, and that's going to have an effect on the economy. but i'm also concerned that profit margins are going to be squeezed. revenue growth will be modest and some costs will increase, and so i think earnings estimates will probably be trimmed down. looks like they are coming down right now. >> so byron, if not u.s. multi-nationals, then where? isn't that one of the big issues that we all face. as investors you just don't have a lot of investors. >> no, you don't. >> i don't think we're going to have a bear market. i just think the market has gotten ahead of itself so those that are recommending that -- that's the point that i'm making. i'm suspicious of this. i think it's gone too far too fast. we're not going to go up 5% a month. i think the market is going to end the year in single digits, not double digits. >> what would be the cat lit, byron? guess we're all waiting to see some spike in interest rates as -- as some leadership that
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tells us, okay, this is the beginning. >> i don't think you're going to see in a. >> exactly. >> i don't think you'll see interest rates go up. >> earnings disappointments, that's will be the catalyst. >> disappointments. earnings disappointments, disappointments in terms of the actual economy which, of course, is no great shakes. >> right, exactly. the economy is going to disappoint. earnings are going to disappoint. if those things don't happen, the market is going to the moon. >> so byron, today we had, you know, financials, technology, all the usual suspects, economically sensitive names driving this market. is that where you want to start shaving positions? is that where you want to start pulling in? some of these groups that were the leadership, or is it a different place? >> well, some of -- you know, some of the stocks that you mentioned, particularly financials, i think are a place to trim. some technology stocks that have run, some of the nasdaq stocks that have really taken off here are places to look for profit-taking. so i -- i would look at the ones that have done the best, rather than the ones that haven't
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participated. >> what do you make of this transportation move, byron? you've looked at these markets for so long and have been such an unbelievable student of all these indexes. i mean, the transportation index up 3%. a lot of people look at the transports and think that this is a telling sign for something. what is your take? >> we think it's a telling sign for the market but i think once again i think it may be overdone. i think you have to look though on that case -- in that case of individual issues. >> and byron, a couple weeks ago we were looking at copper really falling aport. should that have been a telltale sign to know that a selloff is coming. what are the economic indicators that you're looking at that tell you, yes, this is going to be an indicator for the broad economy? >> first of all, i look at sentiment and as i said i think sentiment is beginning to verge on the euphoric and that's always a danger periodch the best time to buy stocks, as you know, is when everybody hates them, and now everybody is loving them. also the fact that the market
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has a one or two-day pullback and then surges ahead again is just intdyicative of the fact tt everybody who didn't participate in the january rally is looking for a chance to get in, and that's what they are doing here so i do think you'll see for a while the pullback result in more buying. eventually the fundamentals, the -- what's going on in washington, the earnings disappointment will take over, and i think the market will become a more reasonable place, but right now it's very excitable. >> all right. well, fundamentals matter. we love to hear it from you, byron wien. good to talk to you. >> thanks for inviting me. >> winners outpacing losers today by a 4-1 margin. the stocks that led the dow, caterpillar, boeing, microsoft, laggards, hewlett-packard and mcdonald's. let's get to josh lipton who has more highlights. >> risk on, the stock market charging higher today. let's dig into what worked.
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in the s&p 500, the industrials led the way, and within industrials joy global took the gold. the mining equipment-maker saying big projects are coming back to the market. the material sector came in second. names like air products and chemicals and air gas both rising. your best performer in the s&p, dollar tree, the discount retailer pleasing investors posting strong sales growth. there was also a list of names making all-time new highs today, many in the consumer space like clorox, general mills and kellogg. as for the dow, the charge higher led by blue chips like ibm, caterpillar, boeing, chevron and jpmorgan. of course, not every stock did finish in the green of the first solar fell hard on weak guidance. target slipped as fourth-quarter profit missed the street's estimates. maria, back to you. >> all right, josh. thanks so much. much more ahead on this busy edition of the "closing bell." the market approaching an all-time record of the sun, the moon and the stars aligned for it to happen? much more. special coverage on this rally today. back in a moment. [ male announcer ] any technology not moving forward
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welcome back. a huge after-hour move from groupon. let's get to julia boorstin who has the story. julia. >> reporter: that's right, maria. groupon just reported its
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earnings that revenues came right in line with expectations but its earnings missed coming in worst than expected and the outlook for the first quarter, the quarter right now, was also much lighter than expectexpecte. the stock is very volatile but the cfo pointed out that in the first quarter they will see a decline in the goods business which is one area they actually benefited from in q4 and they do expect to see growth again in the deal a day business, but this stock is suffering, maria. back over to you. >> thank you, julia. the stock really taking a hit there. take a look in the extended hours. that's the story. despite rising gas prices, a sluggish economy, a staredown between president obama and congress on spending cuts the market continues to climb that wall of worry reaching an all-time high. more now on this week and what this week could tell us about that historic number.
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good to so you guys. fir, let me ask you about the end of the day here. we were up more than 200 at the end of the day. we ended up 175. what did you see in terms of action? was there some stock for sale? >> not so much stock for sale. just saw the market kind of tested at 200 and then just backed off. not a sense of all of a sudden profit-taking. just kind of churning and backing off. i wouldn't -- i wouldn't -- it wasn't overly stock for sale. >> but, are you guys seeing the kind of conviction day in and day out to buy stocks still? >> no. i didn't see it on the way down. there was no panic selling, and i'm not seeing it on the way back you. all the clients i talked, to multi-strategy funds that are out there. watching the whole market swing back and forth and letting do its thing and not getting in the way of anything. very happy with their positions where they stand and they are waiting for the waters to get a little clearer because if you look back a month, two month ago, not much is really different. seeing a lot more volatility in this market now. >> right. but the same funds, they are invested anyway, so as the market moves up, they are
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participating. >> and they are making money. >> making money. >> it's okay. just watching it happen like jonathan said, until there's more clarity, we'll have this continued volatility. >> and bob has a list of things, of challenges. >> are we going to be sucking in any new money as we start hitting new highs? that's the question, and we saw good economic news in the last couple of days. i know prior guests on saying it's all bernanke. i agree the fed is backstopping things, but did you see how we took off this morning? the transports exploded at 9:30 on the durable goods number and big multi-industry companies move up. that's not bernanke. markets responding to economic news. >> bob makes a great point. do you think new money comes in as the market hits new highs? >> i think new money has been creeping in. i don't think it's going to come in like by the wheelbarrow full. people are very cautious and starting to tip their toes back in. moving out of bonds slowly and picking their spots. >> $800 billion came out of stock mutual funds from 2008 to 2012.
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1 trillion went into bond mutual funds. >> that's correct. >> that's a money tavern cash. >> let's not forget all the money into etfs, a real rotation. >> still small numbers compared to what the some mutual fund outflows are. still very small. >> as you see the retail investor keep seeing the headlines of the market going higher and higher as they are waiting and waiting, yes. i think they start coming off the sideline little by little, like kenny said, and they get to a point what is their pain thereby noeld? pain for waiting on the sidelines or the other side, the pain of staying in this market and take profits off the table, so i think this market does come in and not thrust back into the market but little by little this will move higher. >> a slow move up. >> bob, you said the economic data there supports it. >> who knows what would happen if something actually happened in washington, if we get a debt reduction plan, a little more clarify. >> i don't think we're going to get that. >> i know that. i'm hoping. >> that's not reality. we're not going to get for several years on the debt ceiling. >> might for a couple of years.
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that's not out of the question. >> it's not concerned at all about friday morning about sequestration. the market is not concerned about that. looking out six, eight month and i'm not worried about what's going to happen on friday. >> what are the indicators? for example, today, volume wasn't great. >> no, volume hasn't been great. >> so when you see volume not great, does that raise a red flag? mean, you said, you're not seeing the kind of conviction. what other telltale signs when you're out there watching the flow, both of you, in the middle of all the flow? what is it? >> go ahead. >> i think when you see the trading that i'm seeing now is maintenance trading, portfolio managers kind of cleaning up their portfolios, up and down. when i start seeing real positions getting taken and put into stocks, that's when i know there's conviction, when i start to see big numbers on the buy side and the sell side, that's when i get the sense that the smart money out there is smarting to make a move. >> you're not seeing it. >> haven't seen it either way. >> you've got to see the volume really has to start exploding onconsistent basis. that's when you know money will start to move out. >> and ben willis just said to
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us that he thinks the retail investor is back. >> look. inflows in january for the first six weeks have been strong. remember, had this for the last several years in january, and it disappeared after that. i would say the market has a lot of proving to do in terms of investors coming in. i want to see inflows in february, march and april into stock mutual funds and then i'd be impressed. >> all analysis you talked to economists and strategists, they are saying the second half of this year is going to be a stronger -- is going to be a stronger finish to the year so people are starting to look forward to that. that's what i think. once we get through the next couple of month of the sequestration and the debt ceiling, that people will feel much more comfortable and they will start to dip their toes in and we'll see a strong finish. >> who knows what can happen in europe, claarification in europe. clear path to a fiscal union, more clarification. >> you note italians. that's not happening. >> final word. >> tomorrow is the end of the month. we might have seen some window dressing today and might see
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some follow into tomorrow. a lot of economic data coming out tomorrow and friday so it's interesting to see how that all comes together. >> coalition in italy. >> thank you so much. and we'll see a little later. take a short break and more special coverage of the march to an a all-time high. former hedge fund executive todd buchholz says you can't fight the fed. his bullish take on the market is next. don't mission it, and if the president thought the market would be a pressure point to accept gop to hit tax hikes, this rally seems to have put that to rest. why the stock market is ensuring that we're not getting a deal. back in a movement tdd#: 1-800-345-2550 and the better i am at them, the more i enjoy them. . to take 'em up a notch or two. tdd#: 1-800-345-2550 and schwab really helps me step up my trading. tdd#: 1-800-345-2550 they've now put their most powerful platform, tdd#: 1-800-345-2550 streetsmart edge, in the cloud. tdd#: 1-800-345-2550 so i can use it on the web, tdd#: 1-800-345-2550 where i trade from most of the time.
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back. how much locker can the federal reserve keep rates near zero? it all hinges on the target of unemployment of 6.5%, that's the range the fed has talked about. here's what fed chairman ben bernanke had to say about that timeline today on capitol hill. >> it's hard to predict, but a reasonable guest would be 2016, about three more years. >> so it sounds like the gravy train could keep going until 2016. todd buchholz is with us, former managing director of tiger hedge fund. he says don't fight the fed. that's why this rally keeps going and joins us right now to talk more about it. good to have you on the program. >> good to be here, maria sdh thanks so much for joining us. we know what's driving the market, the federal reserve and the fact there's very few alternatives, but what would it take, do you think, for rates to start moving higher? i feel like the bond market is a
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crazy thing sometimes and, you know, it just moves and we see a spike when you're not expecting it. >> well, yes. ben bernanke could be wrong about something very important. that would be inflation. now, i happen to think right now inflation is rather quiet. several of us around here have kids in college. we get high tuition bills so some sectors obviously inflation is galloping along, but overall inflation is pretty quiet, but if the inflation numbers start turning around, then bernanke is not going to be able to keep those interest rates at zero and then the bond market sells off viciously and brings the equity market down with it. i don't think that's likely to happen, but that is the single most important risk to his forecast and for this rally we're seeing. >> what about washington? what about if the markets figure out that we have a credit problem, that, you know, we have $16.5 million in debt and if rates start to normalize, we're talking about enormous interest payments and will that do
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something? >> i don't think that's a nine-month or a 12-month problem, but let's face it, the u.s. government is not facing up to the fact that we're bankrupting our children and our grandchildren, and inevitably we either are going to be on the road to athens, greece, or we're going to get o.right now i see very little movement, though the sequester, someone said it's a terrible idea, but maybe its time has come. >> right, right. what about climbing the wall of worry that we seem to be doing with this market? >> we have a battle right now and it's like muhammad ali and joe frazier when you think about the consumer. on the one hand, you have -- well, look, what is strong? what are consumers buying? as far as i can tell they are buying homes. they are buying automobiles. and they are buying greek yogurt. those are the only three categories that are actually strong. you look at restaurants overall have weakened. walmart, i think there's -- those internal e-mails were shocking. >> where are the customers? >> yeah, yeah. >> walmart represents 2% of gdp
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and if walmart is saying the customers are gone, then the tax hikes have had some impact. >> is that the impact for a market pulling back then, watching the actual fundamentals of the economy, walmart, you know, the payroll tax holiday going away? is that what it's going to take to turn this market down, do you think, or, no, that's not even going to do it? >> if there's any hint of weakness in housing, and granted by all measures, housing looks like it's having a nice little return, but if there ice any signs of weakness in housing or auto sales or greek yogurt, those three categories are demonstrating the consumer is alive f.signs of weakness show up in any of those three the bottom falls out. >> you call italy a sideshow because there's more printing coming from central banks and that at the end of the day is going to save. i feel like the central bankers have saved the policy-makers. sequestration, two days away now. here we are. friday is going to see those 85 billion in cuts take effect. what's the impact? >> well, i mean, look to italy
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for a moment. when they told me the other day that the comedian had gotten the most votes, i thought they were talking about berlusconi. i didn't know they were talking about the professional comedian. look, the central bakes, japan, the uk, the ecb and the fed are printing money, and they have got the ability to continue that as long as inflation stays quiet. as for the sequester, gosh, i would love the president, instead of scaring the hell out of everybody claiming that we're all in peril because of these couple percentage points, if instead he said, as president of the united states, i'm going to defend the american peopling i'm going to make sure these cuts take place in the areas with the smallest impact and not the greatest impact but that's not the tact he's taking. >> so appreciate t.todd buchholz appreciating it right now. former tiger hedge fund manager and former white house senior economic adviser. take a short break and the earnings parade continues. will it push us higher tomorrow or back us off towards the march towards an all-time high and
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then the moment of truth for j.c. penney. were holidays sales hot or not in the retail giant is out. j.c. penney's big reveal, and then all the optimism on wall street may be having an impact on what's happening in washington when the automatic spending cuts set to kick in on friday. stay with us. back in a movement
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. welcome back. the dow pushing its way back towards record highs today thanks to federal reserve chairman ben bernanke and an upbeat report on housing. bob pisani recapping the day that was. >> it's true. ben bernanke did a good job calming fears he might liquidate his portfolio now or any time soon and also that he won't be raising rates. economic news, maria, very important here. look what's happened in the last two days. durable goods, ex-transportation very strong and very good numbers on home sales and consumer confidence. look what happened right out of the gate. transportation stocks exploded at 9:30, before bernanke started testifying. on the upside many names up 2%, 3%. big moves up in the multi-industry names. again, these are big global companies that would benefit from an increase in capital spending, like you see in the durable goods orders. illinois toolworks and ingersoll-rand and a big moveup in defense and aerospace stock
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and, again, another group that would benefit from that. some of those concerns, some of the companies with defense exposure, not a lot of concerns about the sequester. they certainly would be hit. back to you. >> thanks so much, bob. the rally coming as huge spending cuts set to kick in and the white house predicting dire consequences if no deal is made to replace the cuts but the stock market is telling a different story. without a selloff is a deal less likely? joining us now is north dakota senator john hoeven. thanks for joining us. >> you bet, maria. >> the market was falling, selling off ahead of the fiscal cliff, and the gop caved. this time we're near all-time highs. is this giving your side of the aisle more resolve? >> look, maria, we're talking about 2.5% in cuts. that's something we can do. we're willing to give the president the flexibility to do it in the most thoughtful way, and i think what you're seeing in the market is that we're doing what we should be doing, finding necessary reductions,
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rather than raising taxes, and you may be seeing that reflected in the markets today. >> well, i guess my question is do you look at the markets? do you think that this is, you know, telling a story? does this help you that the market is up 175? >> i think it does because we're doing one of the things we have to do which is to get control of our spending. then we have to not raise taxes but rather get pro-growth tax reform that lowers rates, broadens the base and then have entitlement reform where we preserve and protect those programs for the long term. those are the keys to not only getting on top of the debt and deficit but get our economy growing, and i hope the markets anticipating that we're starting to get to those things and get them done. >> well, let me ask you this. i mean, you guys have had -- never mind, you know, month, but even this week, you could have met this week, right, knowing that the cuts are coming friday? what's with these 11th hour meetings? i mean, the president has called now another 11th hour meeting of the congressional leadership on friday? so are you going to go meet?
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what time are you meeting on friday? >> i don't know what time the meeting is, but it is friday, and that's a great question for the president. we're here, ready. we'll give him the flexibility right now to make these reductions in the most thoughtful way to minimize the impacts. let's go. let's do it. >> but, i mean, seriously, what are you expecting to accomplish meeting on the day that the cuts take effect? it almost feels like you guys think we're stupid. the cuts are taking effect on friday, and you're meeting on friday. >> maria -- >> how sensible is that? >> i agree, maria. we should be doing it right now, and you know what? these cuts start to take effect, burks remember this, goes throughout the balance of the fiscal year, so i agree with you. let's get it done. >> let me ask you this. what are you willing to give on to actually get a compromise going in the president has talked about more revenue. are you going to do a deal that includes revenue to avoid these cuts on friday? >> we're not going to agree to higher taxes. revenue comes from economic
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growth, not higher taxes. the president and the democrats raised taxes earlier. now we need to make necessary reductions and real revenue, the way we're going to get revenue is from economic growth. higher taxes would hurt that economic growth, so, no, this is about making necessary savings and reductions in the best possible way, and we'll give the administration the flexibility to do it. >> okay. and real quick, final question here, as we live from cliff to cliff, can you give us a sense of the time line. we've got the sequester cuts beginning on friday, march 1st. then you've got the continuing resolution. what do you expect to get from that and then the debt ceiling debate coming up in may, right? >> correct. i expect that we'll have votes in the senate this week to provide the president with flexibility. if that doesn't pass, i think next week you're going to seat house do the same thing and attach it to the continuing resolution which would fund government for the balance of the year so you both address the issue of keeping the government going and providing flexibility
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to do the reductions in the most thoughtful way. we're ready to go. we're here right now. the president just needs to work with us to do it. >> all right. we will leave it there. thanks so much, sir. good you have to on the program. >> thank you. >> we'll be watching the developments. appreciate your time tonight. >> meanwhile, j.c. penney shares down sharply in the extended hours trading session following the earnings report. check it out down 7% right now. let's get to courtney reagan with the story. >> reporter: j.c. penney earnings on the fourth quarter on an adjusted basis down $1.95. wall street was expecting a loss of 18 sent, so considerably more than that on revenues of $3.88 billion, also below expectations of about $3-4-.09 billion. same-store sales, down more than 31%. wall street had been expecting a decrease of 27%. that is the biggest drop, if you look at each of the quarters, of the past year for j.c. penney's same-store sales. last quarter the same-store
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sales were down 26%. gross margin at 23.8%, considerably lower than what analysts had forecast, and it does appear that there is $930 million in cash and cash equivalent on the jc balance sheet right now. maria? >> all right. thanks so much. we'll be watching that. what a story. j.c. penney down sharply. up next, the rally today happened as apple lost ground. the stock getting bruised in the wake of the contentious shareholder meeting going on. more on that story. stay with apple which closed today at 44 and change. back in a moment. ♪ [ cows moo ] [ sizzling ] more rain... [ thunder rumbles ] ♪ [ male announcer ] when the world moves... futures move first. learn futures from experienced pros with dedicated chats and daily live webinars. and trade with papermoney to test-drive the market. ♪ all on thinkorswim. from td ameritrade. all on thinkorswim. i've always had to keep my eye on her...
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. today's rally happening without one key stock on board. seema modi with the breakdown. >> reporter: a strong day for nasdaq but apple once again did not participate in the real. today, of course, was the day that ceo tim cook addressed a meeting discussing everything from apple's depreciating stock price to its strong sales growth in china and its focus on making great products, but apple didn't really discuss what it will do with its $137 billion in cash that it has on its books keeping many investors wondering if an increase in dividend or a share repurchase is in the near future. the stock ending the day in near territory. >> let's get more perspective from the apple experts. ron winier owns 37,000 shares of apple. gentlemen, good to see you on
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the program. thanks so much for joining us. >> do you buy it? >> yeah. i do buy it. i think today was a non-event, and i think that's maybe why the stock is down, but i do think apple is a shareholder friendly company. if you look at the dividend deal almost 2.5% and it's far greater than a lot of it in the space and i think investors need to keep in mind it was march of last year that they declared for the first time and give apple some time and i think we'll get further return of cash to share holders. >> ron, what do you think? want apple to move away from the extreme cash position so what's your reaction to the lack of news of a diffident increase or a stock split? >> maria, they are going to do something, give money back in some manner, way, shape or form. that's not the big issue. it's like the sequester is a big issue in the government. not big issue. the big issue is apple is trading nine times this year's.
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you take the cash into account. probably seven or eight times. this is a real cheap stock. it will innovate and makes a lot of money. it's going to be fine. the dividends will come in some manner, shape or form is there what about the message of the market? this stock has seen a five-month supplied. >> you're right. >> better than 30% and you want to buy it here. are you still buying? >> yeah. well, to quote former fed chairman, this is a rational pessimism. it was -- everybody loved it to death and couldn't buy enough of it, and now they can't -- they can't stand the stock. neither is true, okay? this is a good, solid company, and when you think it's trading the same multiple as dell, what's wrong? it's more like a google. more like a qualcomm in our feelings about going forward so it deserves a higher multiple and this stock is $760. >> do you ever see it returning to the 700 level? >> yeah. what i said was they innovate a
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little bit and cook made some commen comments. there's more than one product in the pipeline. had some bad numbers last quarter. some of that was the dating and china shipments and all and they are a great company. can't be as they get bigger, but you know what, they will innovate. it's just too cheap now so if you own, it i would keep it, and if you don't own it. i would buy it. >> alex, what's going to most needle on this stock here? what kind of announcement do you think gets this stock up to -- to much higher levels that we've seen in the past? >> i think ron is absolutely right by conventional metrix. attractively valued right here. however, the big remaining to be answered question is the competitive dynamic, and the next blow looks like it's going to go to sam sung here. they are expected to announce galaxy s-4 coming up here march 1th. one of the suppliers to that phone or supposed suppliers is universal display and had
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attractive guidance after the close forthcoming here so i think we'll see the competition go first and as ron said we've got to see what apple can do to reignite optimism over its future? >> okay. >> and is a shareholder friendly act going to do that, something like oh, we're going to increase the dividend, going to buy back stock. what would be the thing that moves the needle. >> i do expect apple to do that at some point this year and the best thing that apple did today is not kowtow to shareholder activism. >> they can declare a dividend on their own terms and own timing and can use it tactically to steal headlines from arrival at some point down the road here. >> everyone wants the information now. want everything now. i think you did the right thing today. too much pressure for him to do something. he'll come out with something. he'll pay money back, but, again, i don't think that's the big issue. the big issue, it's a good company. you should own it. >> sometimes great companies are not great stocks like microsoft. >> well, you know, that's -- it
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depends. if you think that apple is in the microsoft or the dell or the hewlett-packard category, yeah, don't buy it. don't buy it. >> leave it there. >> gets in goingp and that genre, you should buy it. >> gentlemen, thanks so much. appreciate your time tonight. we'll see you soon. >> up next, tomorrow, end of the month. we'll close the month tomorrow at an all time high? our panel of pros weighs in next. ♪
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welcome back. triple digit move. does the rally continue tomorrow? we are less than 90 points away from reaching an all-time high in the dow. let's get 30 seconds on the clock from each of our next guests and find out what you need to know. we have ian wiener. samuel coffin and eric marshall. gentleme gentlemen, good to see you. ian, kick us off. what do you want to be prefaired for tomorrow? >> sure, here we go. gross domestic product. we're looking for more retail earnings tomorrow. kohl's and k mart. and then, finally, as tomorrow
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afternoon comes around, we have the google cfo, the keynote presenter at the morgan stanley tech conference. >> all right, thank you so much. samuel? >> yes, hi. another day of better economic data tomorrow. gdp revised up slightly, but more importantly, inventories in the gdp should show larger drag than they had initially. taking two points off fourth quarter gdp growth. it should be a boost to growth at the start of this year. we're also looking for another drop in jobless claims, about a 15,000 drop, which would re-establish the earlier down trend. >> so, it was a construction in gdp last measure. you think it's going to be revised and not be construction? >> it will be a slight rise and more importantly, weakness in inventories, which will later be reversed. >> okay, eric, you're up. >> well, at the hodges funds, we're going to be focused on the final stretch of earnings season. we wouldn't get caught up in the political noise surrounding
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sequestrati sequestration. tomorrow morning, we're going to listen to the conference calls from copart's, chico's. after the close tomorrow, we'll have earnings out of copano energy and omnivision. they represent a good cross-section of what's going on in the real economy. >> all right, leave it there. gentlemen, thank you so much. a lot of important things to watch for tomorrow and very important on the heels of 175-point rally. see you soon, gentlemen. thank you. up next, buy on the dip? i think that theory was proven this week yet again. that's next. stay with us. with the fidelity guided portfolio summary, you choose which accounts to track and use fidelity's analytics to spot trends, gain insights, and figure out what you want to do next. all in one place. i'm meredith stoddard and i helped create the fidelity guided portfolio summary. it's one more innovative reason serious investors
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how's that for an encore? with xerox, you're ready for real business. and finally tonight, my observation on this rip roaring rally in stocks. probably not a coincidence that we rallied both days that ben bernanke spoke to congress. he's proving once again to be a boone for stocks and proving the old saying, do not fight the fed. you've heard me say many times on this program that this market does not want to go down. that there simply are no good alternatives around the world to u.s. multinationals that pay dividends, have returns and are growing globally. stocks simply put are the best game in

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